Republican senator demands EPA scale back refinery biofuel waivers

Republican Senator Chuck Grassley on Tuesday said Environmental Protection Agency chief Scott Pruitt must scale back the use of biofuels waivers for small refineries, or else he will join other lawmakers calling for Pruitt’s resignation.

The demand ramps up pressure on the embattled EPA administrator, who is already under pressure from mostly Democratic lawmakers to step down over controversies that include high spending on travel and security.

Corn state senators like Iowa’s Grassley have been infuriated by the EPA’s decision to provide an unusually large number of waivers to refineries in recent months, exempting them from a law that requires biofuels like ethanol be mixed into the nation’s fuel.

The EPA has authority to exempt small refineries from the Renewable Fuel Standard if they can prove complying would cause them economic hardship - but biofuels advocates say overusing the waivers kills demand for ethanol.

“I am sick and tired of messing around with this anymore,” Grassley said in a call with reporters, referring to the EPA’s handling of biofuels regulation.

Asked if he thought EPA would scale back the use of the small refinery waivers, Grassley said: “They better, or else I am going to be calling for Pruitt’s resignation.”

The EPA has said its criteria for approving hardship waivers for small refineries has not changed from past years.

Several Democratic lawmakers have called on Pruitt to step down in recent weeks, but President Donald Trump has thrown his support behind the agency chief, saying he is doing a “fantastic” job rolling back hurdles to industry.

Trump has been seeking to mediate discussions with lawmakers over the future of the Renewable Fuel Standard in recent months with an eye toward reducing the regulatory cost for refiners without undermining ethanol demand.

Trump told lawmakers in a closed-door meeting last week that he had decided to do so by expanding sales of high-ethanol gasoline called E15, counting ethanol exports toward annual volumes quotas, and cutting back the use of waivers, according to a source briefed on the meeting.

The corn lobby supports expanding sales of E15 and reducing the waiver program, but opposes counting exports toward volume quotas. The oil industry, meanwhile, is resisting the expansion of E15 - because it worries the move will cut petroleum’s share of the fuel market - and supports both the waivers and the export tweak as ways of cutting regulatory costs.

Reporting by Jarrett Renshaw; Writing by Chris Prentice; editing by Richard Valdmanis and Jonathan Oatis